Wednesday, January 17, 2024 / by Amy Brown
Short term rentals during the pandemic saw an explosion, around the nation and especially in Asheville. In 2021, short term rental owners saw an 85% gain in revenue and by 2022 there were 1.4 million listings nationwide.
The city of Asheville has always had a bit of a stricter stance on short term rental rules than some other vacation destinations but with the latter part of 2022 and all of 2023 experiencing elevated housing costs and a shortage of housing, legislators are now proposing drastic changes to running a short term rental business in Buncombe county. 26 other cities around the country have adopted similar policies and now that vote is up for contention here in Asheville.
This Monday, January 22nd, at the AB-Technical Community College Ferguson Auditorium will be held a Buncombe County Planning Board meeting concerning amending the zoning ordinance for short term rentals countywide. This meeting is open to the public in order to give the community a chance to have their voices heard concerning the new changes.
The amendments will be a part of the Buncombe Comprehensive 2043 plan which has been in the works since 2021. The 2043 plan lays out what will happen as far as growth, infrastructure, and preservation of public and private lands moving forward for the next twenty years. The plan consists of four phases with the final phase being adoption of law. This is phase 4 which means that it will be a crucial meeting for the future of short term rentals in our area.
"During the extensive public input process of the Buncombe 2043 Comprehensive Plan, residents, including historically marginalized groups, expressed concerns about the lack of housing affordability and the use of housing as STRs, which leaves fewer options for year-round residents.
The changes in these text amendments will affect low and middle-income renters, home buyers, and local workers by seeking to make more housing stock available for long-term rentals and owner-occupied housing."
As of 2022, Buncombe county had 5,268 STRs, about 4.5% of housing inventory. If this amendment to the zoning regulations change, then this number will drop drastically.
Asheville's current law on STRs
In place today, Asheville has the homestay law which defines an STR as a commercial lodging use. We currently have some of the strictest rules in the state. A "homestay" is defined as a home within the city limits, it must be an owner's primary residence, they must hold a valid homestay permit subject to inspections, permits allowed only in the conditional-zoning-only expansion district and the resort district, and only a portion of the home can be rented out, not the entire house.
Buncombe county has no restriction on STRs other than those that would be enforced by an HOA.
1. Limit STRs to commercial zoning districts only. If zoned for Open Use (Buncombe county), only group complexes would be allowed with the approval of a special use permit.
2. Dwelling has to be a single family detached home only.
3. Lower the maximum gross floor area of the unit.
4. Must be rented for at least 2 days, no less.
5. Must comply with strict standards for parking, spacing, limits on events, waste management, signage, owner/operator distance from the unit, access standards, additional permitting requirements, and fire safety.
6. Currently operating STRs will have to be granted a new zoning permit.
7. In order to maintain status, unit must be rented for at least 2 days every 180 days.
8. Any existing non-conforming STR, even those transferred by deed, will not be grandfathered in.
9. No STRs in mobile home parks.
10. No STRs in developments that receive county incentives, such as PUD, COD, or density bonus program.
11. Structure must be detached. No multi-family units.
Other locales that have created stricter legislation on STRs
Sylva, NC - must be owner occupied or a long-term rental
Pinehurst, NC - no new STRs in residential districts, existing STRs must obtain a new zoning certificate
Chapel Hill, NC - No STRs allowed in residential districts unless owner occupied
Black Mountain, NC - new requirements: new permit, annual fire inspection, tax reporting, must have: smoke and CO2 detectors, bear-proof trash cans, off-street parking, emergency ladder, post public safety and non-emergency numbers, garbage and recycling information posted, noise ordinance; owner or property manager must live no more than 60 miles from the site, their contact information must be posted
Charleston, SC - owner occupied only with a 15 day notice to neighbors of STR application process
Chattanooga, TN - homestays in limited areas with whole house STRs in commercial districts only
Jackson Hole, WY - only allowed in Lodging Overlay District, unpermitted STRs if caught are banned for 5 years
Santa Fe, NM - 1,000 STR cap, only 12 permits allowed in multi-family complexes, owner must be able to arrive on site in no less than 1 hour, neighbors within 200' must be notified
What does this mean for STR investors looking to purchase in WNC?
This is going to mean big changes, especially for STRs in the county and for owners that live out of state.
If the county adopts the owner/operator distance rule, then owners will have to be within a close distance of the property at all times or hire a property manager that can be. This will mean an additional expense of between 10-15% in revenue to pay for property management services.
This will also severely limit the areas in which owners can run STR businesses even in the rural areas, eliminating any rentals within condo, apartment, mobile home, or even duplex dwellings; regardless of the HOA regulations. They are also proposing that STRs be compiled into grouping complexes. If only allowed in commercial districts, again this will drop the number of homes available for STRs. And it appears that currently operating STRs are going to have to apply for a new permit and comply with signage and outfitting regulations in order to continue to operate, and that granting of a permit is not guaranteed.
While nothing will be voted upon at this meeting, it will be a place to get your voice and concerns heard by the Buncombe County Planning Commission. It will also be a great way to hear what others have to say concerning the new amendments. Mark and I will be there!
Other cities around the nation have enacted everything from imposing a tax on owners to eliminating the practice entirely. For the Business Insider article, click here: https://www.businessinsider.com/cities-fighting-airbnbs-with-regulations-for-short-term-rentals-2022-5#alamosa-colorado-1
The short-term-rental debate won't be over anytime soon. Residents of South Lake Tahoe, California, another vacation hot spot in the West, voted to phase out vacation rentals in 2018 but have been locked in a court battle ever since. Dallas residents will be able to vote, potentially this month, on new short-term rental restrictions, and Nantucket, Massachusetts, is debating a measure that would ban 95% of current short-term rentals on the island.
The future of short term rentals is looking a bit rocky no matter where you go. We will update you on our findings on Tuesday, the 23rd in our daily newsletter.
As always, please call with any questions.